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Project Report
Credit Card and Loan Assessment
s
CONTENTS
Serial No. Particular Page No.
1 Candidate Declaration 5
2 Certificate From Organisation 6
3 Executive Summary 7
4 Banking In India: Overview 9
Nationalized Bank In India 12
Private Sector bank In India 13
5 About AXIS Bank 14
Retail Banking 19
Corporate Banking 19
Financial Performance 21
6 Easy Credit Card 22
Variants 23
Pricing 24
Process 28
Documentation 31
7 Loan Assessment 32
1. Home Loan 33
Documentation 34
1
Interest Rate 35
2. Personal Loan 36
Normal Salaried Individual 36
Salaried Professional 37
Salaried Doctor 38
Documentation 39
Interest Grid 39
Serial No. Particular Page No.
3. Loan Against Property 40
Salaried Individual 40
Professional 41
Self Employed Individual 42
Documentation 43
Interest Grid 45
4. Auto Loan 46
Category Grid 46
Salaried Employee 47
Self Employed 48
Partnership 49
Private and public limited company 50
Documentation 51
Interest Rate 53
5. Agriculture Loan 54
Commodity Power-(Warehouse Receipt
financing)54
2
Agricultural Gold Loan ‘Power Gold’ 60
Power Gold Plus 64
Kisan Power 65
Direct Financing to Farmers for Cattle Loans
through Dairies/ Cooperatives76
Direct Financing to Farmer Under Contract
Farming81
6. Education Loan 86
8 Abbreviations and Acronyms (Glossary) 88
9 Appendix 91
Candidate's Declaration
I hereby declare that the project report titled “Credit Card and Loan Assessment” is
prepared during completion of training of 45 days on 30th June, 2009 and it is an authentic
record of my work carried out under the guidance of Mr. Shakti Singh Rathore, Axis Bank
Jaipur.
VEDANSH JAIN Date: June 30, 2009
Roll No. JGNPGDM0856 Place: Jaipur
PGDM First Batch
(2008-2010)
3
Certificate
TO WHOMSOEVER IT MAY CONCERN
This is to certify that the above declaration made by MR. VEDANSH JAIN, PGDM
(Finance)-First Batch, Jagannath Institute of Management Studies, Greater Noida, U.P., for
the successful completion of 45 days summer training at AXIS Bank, Jaipur, and preparation
of project report titled “Credit Card and Loan Assessment” is true and fair to the best of
my knowledge and belief.
Mr. Shakti Singh Rathore Date: June 30, 2009
Authorised Signatory Place: Jaipur
Axis Bank Jaipur.
Executive Summary:
Introduction:
I have done my training from Axis Bank, Jaipur Branch. I learned there working and
functioning of the bank. Axis bank is one of the fastest growing banks in India and has
extremely competitive and profitable banking franchise. Axis bank is the first new generation
private sector bank to be established in India under the overall reform programme initiated by
Government of India in 1991.Axis bank started its operation from 1994.
Objective:
4
The main objective of undergoing training of 6 weeks (15th May, 2009 to 30 june, 2009) is to:
Understand how banking activities actually takes place.
To gain an insight and in depth knowledge about banking products.
To know how the other services provided by bank to its customer.
To learn about corporate banking culture in India.
Research Methodology:
The method adopted to carry out this report was based on both the primary and secondary
sources.
Primary sources:
Interaction with the existing employees and deputy manager.
Personal interaction with the customers visiting to the bank.
Secondary sources:
Manuals of the bank.
Websites
Journals
Circulars
Annual Report
Learning and Conclusions:
It was a great opportunity to gain an insight about various activities that takes place in the
bank.
I came to know what banking is all about.
About AXIS Bank.
The kind of products and services are provided by AXIS Bank.
This training increased my confidence level and it was a great opportunity to learn about
corporate culture and etiquettes.
It was a great opportunity to develop persuasion skills and communication skills.
5
Banking In India: Overview:
Banking in India originated in the first decade of 18th century. The first banks were The
General Bank of India, which started in 1786, and Bank of Hindustan, both of which are now
defunct. The oldest bank in existence in India is the State Bank of India, which originated in
the "The Bank of Bengal" in Calcutta in June 1806. This was one of the three presidency
banks, the other two being the Bank of Bombay and the Bank of Madras. The presidency
banks were established under charters from the British East India Company. They merged in
1925 to form the Imperial Bank of India, which, upon India's independence, became the State
Bank of India. For many years the Presidency banks acted as quasi-central banks, as did their
successors. The Reserve Bank of India formally took on the responsibility of regulating the
Indian banking sector from 1935. After India's independence in 1947, the Reserve Bank was
nationalized and given broader powers.
Early History:
6
Other Nationalized Banks
Other Nationalized Banks
RESERVE BANK OF INDIACentral Bank and supreme monetary
authority
RESERVE BANK OF INDIACentral Bank and supreme monetary
authority
Non Scheduled Banks
Non Scheduled Banks
Foreign Banks
Foreign Banks
Private Sector Private Sector
SBI & Associates
SBI & Associates
Regional Rural Banks
Regional Rural Banks
Urban Cooperatives
Urban Cooperatives
State Cooperatives
State Cooperatives
Scheduled Banks
Scheduled Banks
Cooperative
Cooperative
Public Sector Public Sector
Commercial
Commercial
The first fully Indian owned bank was the Allahabad Bank, established in 1865. However, at
the end of late-18th century, there were hardly any banks in India in the modern sense of the
term. The American Civil War stopped the supply of cotton to Lancashire from the
Confederate States. Promoters opened banks to finance trading in Indian cotton. With large
exposure to speculative ventures, most of the banks opened in India during that period failed.
The depositors lost money and lost interest in keeping deposits with banks. Subsequently,
banking in India remained the exclusive domain of Europeans for next several decades until
the beginning of the 20th century. Foreign banks too started to arrive, particularly in Calcutta,
in the 1860s. The
Comptoire d'Escompte de Paris opened a branch in Calcutta in 1860, and another in Bombay
in 1862; branches in Madras and Pondichery, then a French colony, followed. Calcutta was
the most active trading port in India, mainly due to the trade of the British Empire, and so
became a banking centre.
The Bank of Bengal, which later became the State Bank of India.
Around the turn of the 20th Century, the Indian economy was passing through a relative
period of stability. Around five decades had elapsed since the Indian Mutiny, and the social,
industrial and other infrastructure had improved. Indians had established small banks, most of
which served particular ethnic and religious communities.
The presidency banks dominated banking in India. There were also some exchange banks and
a number of Indian joint stock banks. All these banks operated in different segments of the
economy. The exchange banks, mostly owned by Europeans, concentrated on financing
foreign trade. Indian joint stock banks were generally under capitalized and lacked the
experience and maturity to compete with the presidency and exchange banks. This
segmentation let Lord Curzon to observe, "In respect of banking it seems we are behind the
times. We are like some old fashioned sailing ship, divided by solid wooden bulkheads into
separate and cumbersome compartments."
By the 1900s, the market expanded with the establishment of banks such as Punjab National
Bank, in 1895 in Lahore and Bank of India, in 1906, in Mumbai - both of which were founded
under private ownership. Punjab National Bank is the first Swadeshi Bank founded by the
7
leaders like Lala Lajpat Rai, Sardar Dyal Singh Majithia. The Swadeshi movement in
particular inspired local businessmen and political figures to found banks of and for the Indian
community. A number of banks established then have survived to the present such as Bank of
India, Corporation Bank, Indian Bank, Bank of Baroda, Canara Bank and Central Bank of
India.
Nationalized Banks in India:
Banking System in India is dominated by nationalized banks. The nationalization of banks in
India took place in 1969 by Mrs. Indira Gandhi the then prime minister. The major objective
behind nationalization was to spread banking infrastructure in rural areas and make available
cheap finance to Indian farmers. Fourteen banks were nationalized in 1969. Before 1969,
State Bank of India (SBI) was the only public sector bank in India. SBI was nationalized in
1955 under the SBI Act of 1955. The second phase of nationalization of Indian banks took
place in the year 1980. Seven more banks were nationalized with deposits over 200 crores.
List of Public Sector Banks in India is as follows:
➢ Allahabad Bank ➢ State Bank of India (SBI)
➢ State Bank of Indore ➢ State Bank of Mysore
➢ State Bank of Patiala ➢ State Bank of Saurashtra
➢ State Bank of Travancore ➢ Syndicate Bank
➢ UCO Bank ➢ Union Bank of India
➢ United Bank of India s ➢ Vijaya Bank
➢ Andhra Bank ➢ Bank of Baroda
➢ Bank of India ➢ Bank of Maharashtra
➢ Canara Bank ➢ Central Bank of India
➢ Corporation Bank ➢ Dena Bank
8
➢ Indian Bank ➢ Indian Overseas Bank
➢ Oriental Bank of Commerce ➢ Punjab and Sind Bank
➢ Punjab National Bank ➢ State Bank of Bikaner & Jaipur
➢ State Bank of Hyderabad
Private Banks in India:
All the banks in India were earlier private banks. They were founded in the pre-independence
era to cater to the banking needs of the people. But after nationalization of banks in 1969
public sector banks came to occupy dominant role in the banking structure. Private sector
banking in India received a fillip in 1994 when Reserve Bank of India encouraged setting up
of private banks as part of its policy of liberalization of the Indian Banking Industry. Housing
Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in
principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private
sector.
Private Banks have played a major role in the development of Indian banking industry. They
have made banking more efficient and customer friendly. In the process they have jolted
public sector banks out of complacency and forced them to become more competitive.
List of Private Sector Banks in India is as follows:
Bank of Rajasthan ➢Bharat Overseas Bank
Axis Bank ➢Catholic Syrian Bank
Centurion Bank of Punjab ➢Dhanalakshmi Bank
Federal Bank ➢HDFC Bank
ICICI Bank ➢IDBI Bank
IndusInd Bank ➢ING Vysya Bank
Jammu & Kashmir Bank ➢Karnataka Bank
Karur Vysya Bank ➢Kotak Mahindra Bank
SBI Commercial and International Bank ➢South Indian Bank
United Western Bank ➢ YES Bank
9
10
About AXIS:
Start on 1994
On July 2007 UTI Bank rebrand as Axis Bank
Promoters:
Unit Trust Of India (UTI)
Life Insurance Corporation (LIC)
General Insurance Corporation (GIC)
National Insurance Company Limited
New India Assurance Company Limited
The Oriented Insurance Company Limited
United India Insurance Company Limited
Capitalization:
359 crore
Public Holding = 57.60%
Registered Office:
Ahemdabad
Central Office:
Mumbai
11
Total Branches:
827
ATM:
3595
Bank Strengths:
Retail Banking
Corporate Banking
Directors:
Shri N.C. Singhal Director
Shri J.R. Varma Director
Dr. R.H. Patil Director
Smt. Rama Bijapurkar Director
Shri R.B.L. Vaish Director
Shri M.V. Subbiah Director
Shri Ramesh Ramanathan Director
Shri K. N. Prithviraj Director
Auditors:
M/s. S. R. Batliboi & Co. Auditors Chartered Accountants
Registrar and Share Transfer Agent:
M/s. Karvy Computershare Private Limited
Competitors:
12
Private Sector competitors:
HDFC
ICICI
Public Sector competitors:
SBI
PNB
Profile:
Axis Bank is one of the fastest growing banks in the country and has an extremely
competitive and profitable banking franchise evidenced by:
Comprehensive portfolio of banking services include Corporate Credit, Retail Banking,
Business Banking, Capital Markets, Treasury and International Banking.
The Position as on 31st March 2009 was as under: -
Balance Sheet Size Rs 1,47,722 crore
Total Deposits Rs 1,17,374 crore
Net Advances Rs 81,557 crore
Investments Rs 46,330 crore
Net NPA 0.35%
Capital Adequacy Ratio 13.69% %
Axis Bank has in place a sound technological platform:
13
Sound technological platform with centralized database and operations enabling 24*7*365
‘Anywhere Banking’, in order to render the best customer service to its 5.5 million customer
base.
Mission and Values:
Customer Service and Product Innovation tuned to diverse needs of individual and
corporate clientele.
Continuous technology up gradation while maintaining human values.
Progressive globalization and achieving international standards.
Efficiency and effectiveness built on ethical practices.
Customer Satisfaction through providing quality service effectively and efficiently.
"Smile, it enhances your face value" is a service quality stressed on Periodic Customer
Service Audits.
Maximization of Stakeholder value.
Success through Teamwork, Integrity and People.
Retail Banking:
The Bank continued with its thrust on customer segmentation in the retail liabilities business
to spearhead growth during the financial year 2008-09. Savings Bank deposits grew to Rs.
25,822 crores on 31st March 2009 from Rs. 19,982 crores as on 31st March 2008 showing a
year on year growth of 29%.
Corporate Banking:
14
The Business Banking Department (Erstwhile Institutional Business Department) was set up
in the year 2000, with the objective of having a special cell to serve the institutional and
corporate clientele of the Bank. Business Banking initiatives revolve around transaction
banking services to garner Business Current Accounts, Cash Management Service mandates,
Government Business - Collection & Payment Services. As a natural corollary, scope of the
business was extended this year to Business loans for Small Businesses so that all product and
services to small business enterprises are comprehensively made available.
The Department presently focuses on the four broad areas through the respective
Business Groups, as under:
Business Current Accounts
Business Assets
Cash Management Services
Government Business
Corporate Credit:
Current Account deposits grew by 24% yoy, from Rs. 20,045 crores as at end March’08 to Rs.
24,822 crores as at end March’09. The daily average Current Account balances over the year
grew by 24% yoy. The Corporate Credit portfolio of the Bank comprising advances to large
and midcorporates grew by 68.33% to Rs. 29,026 crores from Rs. 17,244 crores a year ago.
This includes advances at overseas branches amounting to Rs. 5,381 crores (equivalent to
USD 134 million) comprising in main the portfolio of Indian corporates and their subsidiaries,
as also trade finance. Credit exposures are taken based on risk analyses and mitigation
measures, with proposals being subjected to critical scrutiny by the Bank's Risk Department.
Efforts are made to constantly upgrade the skills required for faster turnaround of credit
proposals and structuring of financial products. In addition to working capital loans, the Bank
also takes long-term exposures to infrastructure and manufacturing projects set up by reputed
industry groups. Relationship groups in the Bank are organised with an industry sector focus
for better evaluation of specified risks. The credit policy of the Bank has also put in place
ceilings on exposures to various industries with a view to containing concentration risk and
facilitating portfolio diversification.
15
Financial Performance:
Profit after tax up 69% to Rs.1,815.36 crores.
Net Interest Income up 43% to Rs.3686.21 crores.
Other Income up 61% to Rs.2,896.88 crores.
Fee Income up 64% to Rs.2,447.35 crores
Deposits up 34% to Rs.1,17,374 crores.
Demand Deposits up 37% to Rs.50644 Crores.
Advances up 61.79% to Rs.81,557 crores .
Retail Assets up 18% to Rs.16,052 crores.
Network of branches and extension counters increased from 827.
Total number of ATMs 3595.
Net NPA ratio as a percentage of net customer assets down to 0.35% 0.36% from 0.36 %.
Earning per share (Basic) increased from Rs.31.31 to Rs50.27.
Proposed Dividend up from 45% to 60%.
Capital Adequacy Ratio stood at 13.69% as against the minimum regulatory norm of
9.26%.
**********************
Easy Credit Card:
What is Easy Credit Card?
A Credit Card that is ...
16
Easy for customers to get!
Easy for us to sell!
Why is it “Easy” for the Customer?
Flexible Credit Limit (Up to 80% of the FD amount)
High Cash Withdrawal Facility
Minimum Documentation (No Income Proof/KYC required)
Fast Delivery of the Card
Substantially Lower Interest Rate of 1.95% p.m.
Guaranteed Approval
Free Credit Period of 20-50 days
Comprehensive Insurance
Attractive Reward Points
Other benefits of a regular credit card
Easier than Other Modes of Payment:
Easier than Other Credit Cards
Guaranteed Approval
No Income Proof required
Lower interest rate
Credit Limit of choice
Higher Cash withdrawal facility
Easier than Debit Cards
17
Interest free credit period of up to 50 days
Higher Insurance Package
Ease of Online & MOTO transactions
Easier than O/D against FD
Interest free credit period of up to 50 days
Reward Points
Complimentary Insurance
Record of transactions
Easier than Cash
Convenience of Plastic
Complimentary Insurance
Reward Points
Record of transactions
Variants:
Available in three variants:
Easy Platinum Premium (In sourcing locations only)
Easy Platinum
Easy Gold
18
Pricing:
Type Joining Fee Annual FeeAnnual Fee Waiver
for Year 2
Platinum
Premium 5,000 1,000Customer Spends
> Rs.2,00,000 in Year 1
Platinum 1,000 500Customer Spends
> Rs.2,00,000 in Year 1
Gold Nil
100
(Two Years
onwards)
Customer Spends
> Rs. 50,000 in One Year
* Annual Fee can be adjusted against Reward Points
Easy Platinum Premium:
Platinum Comprehensive Insurance Cover
Fuel savings of 2.5% at All Petrol Pumps
Attractive Rewards Program
Free Espirit watch worth Rs.6,000Attractive
Platinum Preferential Features
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Chip Card for Additional Security
Complimentary Priority Pass Membership
International Concierge Services
Exciting shopping offers
Platinum Standard Features
Low Interest Rate of 1.95% p.m.
Credit Limit of Choice
High Cash Withdrawal Limit of 40% of Credit Limit
Balance Transfer Options
Easy Platinum:
Comprehensive Insurance Cover
Fuel savings of 2.5%at ALL Petrol Pumps
Attractive Rewards Program
Platinum Preferential Features:
Chip Card for Additional Security
Complimentary Priority Pass Membership
International Concierge Services
Exciting shopping offers
Standard Features:
20
Low Interest Rate of 1.95% p.m.
Credit Limit of Choice
High Cash Withdrawal Limit of 40% of Credit Limit
Balance Transfer Options
Easy Gold:
Comprehensive Insurance Cover
Fuel savings of 2.5%at ALL Petrol Pumps
Attractive Rewards Program
Standard Features:
Low Interest Rate of 1.95% p.m.
Credit Limit of Choice
High Cash Withdrawal Limit of 40% of Credit Limit
Balance Transfer Options
Process Simplified:
21
Step 1
Crédit Card Application Form
NoOnly One Single Application Form
Letter of Lien
Addendum to Credit Card Application
Form
Draft Letter
Step 2
Double KYC No Separate KYC for Easy Credit Card
Step 3
FD retained at the branch
No
FD receipt to remain with the customer
Only photocopy to be attached
Lien marked centrally on Finacle
Step 4
Customer signature on form to be verified
by Branch heads NoCustomer signature to be verified by
Branch head/ BSO/BSM
Step 5
Card dispatched to Branch
No
Sent to customer in Courier serviceable
areas
Sent to branch in Courier non-
serviceable areas
Application Processing- Existing FD Customers:
Application Pickup
22
Easy Credit Card App Form filled
Copy of FD receipt attached
No Additional Documents
At Branch
Application Signed-off by Branch head/ BSO / BSM
Lien Stamp on FD by any Branch official–Original returned to customer
CC-APU
Centralized Lien marking
Data Entry , Card & Limit Setup
No CIBIL, No FV, No TV
Dispatch
Direct to customer in Courier serviceable areas
To branch in Courier non-serviceable areas
Application Processing -New FD Customers:
Application Pickup
Easy Credit Card App Form filled
23
FD Form filled with KYC & PAN only by BDE/Any Branch Staff
At Branch
Sign-off by Branch head/ BSO/ BSM
CPU-Mumbai
FD Data Entry
FD Account No. entered on Easy Card Application Form
CC-APU
Centralized Lien marking
Data Entry , Card & Limit Setup
No CIBIL, No FV, No TV
Dispatch
FD & Card dispatched together
Direct to customer in Courier serviceable areas
To branch in Courier non-serviceable areas
Documentation:
Existing FD Customers:
Easy Card Application Form
24
Photocopy of FD Certificate with Notification of Lien as follows: “Lien marked for
Issuance of Easy Credit Card” To be written, signed & stamped by any Branch Official on
the front side of the FD receipt
FD Certificate with notification returned to customer
Most Important Document (MID)
New FD Customers:
Easy Card Application Form
Duly Completed FD Application Form (ONLY by BDE/Any Branch Staff)